Construction of new homes and applications for building permits fell in December, as was expected due to cold weather. The good news is that the whole of last year had the strongest showing since 2007.

Consumer sentiment sagged a little, as people were concerned about the job market, while rising gas prices did not help.

Industrial production ticked up 0.3%, driven by manufacturing and mining activity.

Long-only equity funds got a big boost this past week, according to the latest flow data from Bank of America Merrill Lynch’s research shop. Stock funds took in a whopping $9.4 billion, and $6.5 billion of that went to long-only funds, the biggest weekly inflow for that category in a year.

Bonds, meanwhile, took in only $1 billion (but inflows nonetheless!). Given that Bank of America Merrill Lynch has long been pushing the theme of a Great Rotation out of bonds and into stocks, Hartnett reminds us that there’s a ways to go in terms of the rotation (chart at right). But we should mention that he’s far from the consensus, and a growing number of people are actually talking about an anti-Great Rotation.

Commenting on the markets, Chris Bouffard, chief investment officer at the Mutual Fund Store said that it is not surprising to see a little consolidation.

“Markets rallied late last year in anticipation of economic growth, but now are taking a step back and digesting some of the mixed economic news. For example, last weeks jobs numbers were puzzling, while the rest of the picture is mostly in line with forecasts.

We do expect a pullback or a moderate correction at some point this year, but do not think it will be a drastic one.”

Shares of Electronic Arts Inc. are on high octane on Friday after analysts at CRT Capital initiated coverage of the stock at a “buy” with a price target of $26. “Our buy rating is not for the faint of heart, as EA continues to have mishaps with game launches, has too few original IP, and has had challenges with console cycles in the past,” analyst Neil Doshi said in a note. Still, EA is expected to regain some of its luster with the launch of much anticipated Titanfall in March. It is also expected to be a strong year for EA’s FIFA franchise given the World Cup in Brazil, he said.

Nu Skin Enterprises Inc. sank further into negative territory as fears over a regulatory probe in China prompted investors to dump the stock. Chinese authorities are investigating allegations that Nu Skin is operating an illegal pyramid scheme, the company said in a statement. In response, the distributor of personal care products said it has launched its own review and plans to seek guidance from “relevant regulators.”

This appears to be the right approach for Nu Skin in handling China’s complex bureaucracy, according to analyst Timothy Ramey at D.A. Davidson & Co.

“We don’t believe the companies we follow that operate in China are illegal operations,” said Ramey in a report published Thursday. However, he notes that China experts discourage companies from challenging the country’s regulators. “It may well be that the ‘I’m sorry, how much is the fine, let’s move on’ defense is the most likely outcome,” Ramey said.

China accounts for 50% of the company’s sales and it expects a negative impact on its revenue in the Asian country.

Financial stocks are getting a reprieve Friday after stinking up the market in the prior session. American Express is up 4.7%, the second-best on the S&P 500. Visa is rising 4.1%, the third best. And Morgan Stanley is gaining 3.9%, the fourth-best S&P 500 stock.

Investors seem to be buying into the Morgan Stanley storyline that boring is beautiful, writes banking reporter Christina Rexrode.

“The bank sketched out plans that include higher margins for the wealth management unit, more lending and higher dividends, among other rosy returns,” she writes.

Also possibly goosing the stock: the bank pledged to increase stock buybacks. And it provided clarity, of a painful kind, on the cost of litigation. It set aside $1.2 billion for potential legal expenses, shaving 40 cents off earnings per share and causing the bank’s profits to miss earnings by a mile. What’s not to love?

A closer look at why the Dow average is bucking the trend, shows that it is because of solid gains in American Express and Visa. The Dow average is a price-weighted index, so a big move in Visa, whose price is $230, can indeed lift the whole index.

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